CBN disagrees with NGF over 2020 recession

The Central Bank of Nigeria, CBN, yesterday, faulted the position of the Nigerian Governors Forum, NGF, that there will be recession in 2020.

CBN Deputy Governor, Policy, Dr. Joseph Nnanna, expressed optimism that the economy would grow on the positive side, rather than go into recession next year. He said: “Are we going to witness increased inflation or are we sliding back into recession? My answer is no. We are making smooth progress towards growth and by end of 2019, all things being equal, we are going to likely have between 2.8 and 3 percent GDP growth rate. “But is that adequate? My answer is no.

Three percent GDP real growth rate is not enough for Nigeria where our population growth rate is 3.2 per cent. So, per capita growth rate is still negative but definitely, we are not going through the era of 2016 when we had a recession. That won’t happen. Hopefully, not under CBN watch “We will grow, unlike in 2016 when we slid into recession. Hopefully, not under the CBN watch. We are going to maintain the policy interest rate in real terms.

“For the money market, our promise to external investors be they portfolio investors or foreign direct investors is that we are going to continue to maintain positive relationship. And the yield in Nigeria is comparative if not more superior to the yield in other emerging market economies. Those who want to invest in the frontier market, the place to be is here.

We have kept the capital repatriation policy. The promise we made in 2005, we have kept since 2005 and it is a promise that we will continue to keep. “If you come with a trailer-load of dollars or Euros and you want to go back, you will be allowed to go back with a trailer-load of dollars, of Euros, after you have paid the legitimate tax, with your profits.” The IMF Director, Africa Region, Mr. Abebe Selassie, urged African countries to reduce conflicts, public debts and make efforts to grow their economies better.

He noted that 17 African countries were heavily indebted and that debt service was eating far too much into revenues, across the continent, thereby drastically reducing available infrastructure and social expenditure.